Business in the Community speech

23 February 2012(Transcript of the speech, exactly as it was delivered)

First published:

23 February 2012

This speech was published under
the 2010 to 2015 Conservative and Liberal Democrat coalition government

David Cameron's speech to the Business in the Community charity.

Thank you for that introduction and thank you for that welcome, ladies and gentlemen. It is a pleasure to be back speaking alongside His Royal Highness. Long before corporate responsibility was a big thing, before those buzz-phrases like ‘ethical accounting’ and ‘social value’, the Prince was there, urging business to do more, to give more, to think more about their impact on the world and in so many areas - as in so many areas, his long-term, patient, thoughtful interest has been proved absolutely right.

Now, of course, we have in this country a great history of businesses doing good, from the welfare schemes in Joseph Rowntree’s factories to the housing for workers at Port Sunlight. But it does take dedicated champions, like His Royal Highness, like Business in the Community, to keep this cause relevant and real. And today, business needs champions more than ever.

In recent months, we’ve heard some dangerous rhetoric creep into our national debate: that wealth creation is somehow anti-social, that people in business are somehow out for themselves. I think we have to fight this mood with everything that we’ve got, not just because it is wrong for our economy - because we need the jobs and the investment that business brings - but because it is also wrong for our society.

Business is not just about making money, as vital as it is. It is also the most powerful force for social progress that the world has ever known. It can help us to smash poverty, to raise horizons, to drive the innovations, products and services that make our lives better, longer and happier. And yes, as we’ve heard, including from those inspirational talks today, some of the amazing things that business is doing in our communities, helping to build bigger and stronger societies. I don’t think this gets celebrated enough. So what I want to argue today is that those of us who believe in business, in enterprise, in markets need to come together and prove the sceptics wrong. We need to say that now more than ever we need the creative talent of business not just for economic innovation but for social innovation too.

And let’s be clear about what we heard today. That social innovation then gets transported back into business and the leaders that you put out into the community will come back as even stronger business leaders for your benefit in the future.

Now for me, this is particularly important. Corporate responsibility is an absolutely vital part of my mission for this government which is to build a bigger and stronger society. The Big Society is all about people recognising that they have obligations beyond just paying their taxes and obeying the law. Not just doing no harm but doing good, and this applies to businesses as much as it does to individuals. Personal and business responsibility go hand in hand. Now many people have told me I should ditch this approach. They say it’s not the right time, it’s not popular or it’s a distraction. But I say that core belief in social responsibility not state control is something we’re never going to change. Why? Because if you look at the scale of the challenges that we face, whether it’s youth unemployment, family breakdown, drug and alcohol addiction, does anyone really think we can turn these things around just by government changing laws or passing down edicts from above? Of course not. We’ve tried the top-down approach to running a country and we’ve seen that it doesn’t work. What’s really going to change this nation is collaboration, cooperation; businesses, charities, individuals working with each other and with government to make life better; not just government action but social action, not just government responsibility but personal and corporate responsibility. That is going to make the difference to our country.

Now, of course there are those who attack this approach and, as I see it, there are three main accusations. First, that this is just a cover for cuts, a way for government to duck its own responsibilities. Second, some people argue this is a fig-leaf of respectability for business, a way for companies to convince the world they’re doing great things when actually they’re not. And third, some people argue that business’s role in strengthening society is a distraction from its real job which is making money. Let me take these three in turn.

Let’s start with the argument that this is all just a cover for cuts. It goes that when politicians like me talk about responsible business, what we’re really trying to do is outsource the work of government and get social change on the cheap. Now, there is a flaw in this argument, which is that I’ve been talking about building a bigger, stronger society for years, long before the necessity for cuts. Because even if government had 10 times the money that we had today, there would still be big, big problems that we couldn’t crack on our own.

Take the obesity crisis. Now, government can run public health campaigns, it can make other interventions, but if the food and drinks industry make it harder not easier to live a healthy life, we will always be defeated. That’s why we’ve signed supermarkets and high-street restaurants up to the responsibility deal, to encourage them to play their part, like Subway and Costa putting calorie information up when people are buying. The point is, there are parts of our society that business can reach which the state just can’t.

And then, of course, there are those things that business is simply better at than government. Think of what the Big Issue has done to give dignity to homeless people. Think of what Marks and Spencer is doing by employing those with mental health problems. They’re changing the way that people think in a way that government on its own simply cannot do. Business is very good at influencing attitudes, coming up with fresh ideas. That is why we set up Every Business Commits. It asks business to do more across five areas: improving skills, supporting small business, protecting the environment, improving the quality of life and helping local communities. Norman Lamb, our new Minister for Corporate Responsibility, is going to be driving this forward and the good news for him is that real progress, as you’ve just heard, is already being made.

Take, for instance, apprenticeships. There were a record number of apprenticeship starts last year, but we want more. So we sent out the call for more companies to come forward and offer them, and the response is that we’ve had 5,500 new apprenticeship places already offered since the start of this year. I believe this is a powerful answer to the critics: asking business to do more - that isn’t about making do and mending, it’s about making things better. And while we’re arguing this, I think we’ve also got to take on what are frankly some pretty snobbish attitudes, the snobbery that says business has no inherent moral worth, like the state does, that it isn’t really to be trusted, that it should stay out of social concerns and stick to making the money that pays the taxes.

We see this in the debate on education. Put a young person into a college for a month for learning unpaid and it’s hailed as a good thing. Put a young person into a supermarket for a month learning unpaid and it’s slammed as slave labour. Put a child into a great school run by a local authority, that’s a cause for celebration. Put them into a great school backed by a bank, and that is a cause for suspicion. Frankly, I’m sick of this anti-business snobbery. I see companies like UBS sending their workers into the Bridge Academy in Hackney, raising those children’s sights. I see Barclays offering over 3,000 work experience placements for pupils and I say this has got nothing to do with cuts and everything to do with improving our country and frankly it should be applauded rather than talked down at.

But the second accusation I want to take on is that corporate responsibility is just a bit superficial. It’s the idea that companies are winning people over without actually helping to change the world. Now the truth is that when this movement first began there was an aspect of it, there was some of it which was quite superficial. You did get some companies practising a sort of moral offsetting, allowing irresponsible things to happen day after day then once a year making a big payout to charity to ease their conscience. But over the last two decades, corporate responsibility has changed utterly. Today, it is all about integrating your values deeply into the soul of your business.

So, Starbucks don’t just give millions to charity;they also help coffee farmers all over the world to boost their incomes. BT don’t just support charities like ChildLine; they have a great track record in supporting women back to work after maternity leave. Now, the Business Connectors approach we’ve seen absolutely embodies this approach. Companies like Sainsbury’s, like Greggs, like Lloyds, aren’t just saying, ‘Here’s some money’. They’re saying, ‘Here are our people. Here are some of our best people: our store managers, our executives, our directors.’ And they’re now, as you’ve heard, helping shopkeepers devastated by the riots, setting up mentor schemes, giving a boost to local charities, making a real difference on the ground. And as I’ve said, when they’re finished as Business Connectors, they’ll go back to their businesses absolutely fizzing and buzzing with new ideas. That’s what this is about: doing good and doing well out of it.

Now, that links to the final argument against responsible business: that somehow it’s a distraction from the real job of making money. Milton Friedman once said that the social responsibility of business is to maximise profits. Now, in one important sense, he’s right; profit making keeps investment flowing and it creates the jobs and the prosperity that we need in our country. But where I think he’s wrong is to assume there’s a contradiction between improving your prospects and improving the world. As Prince Charles has just argued so forcefully, they should go together. Just look at, for instance, what Unilever have done recently in India. They saw a fortune at the bottom of the pyramid. Millions of people had small amounts of disposable income, so they developed products specifically for that market. The customers were winning, but the business was winning too.

There is a clear, hardheaded business case for behaving responsibly and that is especially true when you think of the all-important issue in business today of how you build a strong brand. Businesses live or die today by their likeability. People like John Lewis because they know their staff get a share of the profits. People like The Body Shop for its work in the developing world. But the problem is they can be the exceptions because the vast majority of fantastically good business goes under the radar. And today I want to say how I hope we can help you to change that; to link the good work you’re doing much more directly with public recognition.

This is a government that believes very strongly in transparency; in making public information. We’ve seen how powerful it can be. Since 2010 we’ve released unprecedented amounts of public data and the response has been phenomenal. Our crime maps literally receive thousands, tens of thousands of hits every single day. And a whole new industry is springing up to seize on this data and make it user-friendly. I had to award a prize for the best app that had been developed recently, and as I went round the room in Number 10Downing Street, I realised that almost every single app was actually making use of government information. Where was the shortest waiting time in a hospital? Where was the safest street in our country? Which universities had the best results? Which departments were wasting the biggest amount of money? All this information is now available; not just creating better government, but creating business opportunities too.

All of this is backed by new technologies. Amazon now has an app that lets you scan a product in a shop and see in seconds if you can get it cheaper elsewhere. Now, just imagine the possibilities of that for responsible business. You could get people choosing their mobile phone company not just on tariffs, but on carbon emissions. Or choosing supermarkets not just on price, but on their values and how green they are.

Now, I know many of you in this room are already very open, but the truth is not enough are and most consumers don’t know where to find out that information anyway. We think this needs looking at and I know that many of you do too. Let me be clear: we are not talking about heaping more burdens on you. We want business to lead, devise and shape this new era of transparency.

So, today I can announce we’re setting up an informal working group called the Open Business Forum chaired by Philip N. Green, our advisor on corporate responsibility. This is going to bring together companies like yours. It’s going to ask how we can make business more transparent without making life more difficult, but with the help of government. And for smaller businesses, we’ve teamed up with companies to launch something else: an online directory called Trading for Good, showing where small businesses are doing good things, so consumers can know about it and reward them for their work. All this could, I believe, be a new frontier for corporate responsibility; giving more power to the consumer, changing our culture and above all, reinforcing that vital link between responsibility on the one hand and profit on the other.

I want to end by reiterating my core message to you today: free enterprise is the best imaginable force for improving our lives and it has a powerful role to play in renewing our country. As we go forward together, I want the relationship between this government and business to continue as it started: not leading you, but collaborating and cooperating with you. Not bossing from the top down, but encouraging the changes you’re making from the bottom up. Working together for more responsible business, for a bigger and stronger society and above all, for a better country. Thank you very much indeed for listening.